Strategic Management: An Integrated Approach

The purpose of this assignment is we need to start a firm by collaborating with few people  and then investigate the company on some parameters.

My company name is “A Wedding Story” a service or event based industry.

The company will plan and arrange the wedding related activities.

Analyze the below questions and answer them appropriately using the text book 

 —Charles W. L. Hill and Gareth R. Jones. Strategic Management: An Integrated Approach, Theory and Cases( 2015) 12th edition

or

—Sources from internet

·      The organizational structure of the company and its governance. Ethics and Corporate Social Responsibility

·      The strategic leadership of the company

·      The competitive advantage of the company and how the company takes advantage of its competitive    advantage in the marketplace

·      The financial viability and growth of the company

·      How the company formulate and implement strategy at the functional, business and global level

·      How the company’s strategic planning relates to domestic and global expansion and growth

·      How the company use technology to perform and advance competitive advantage 

·      How the company sees its own environment in its own business and industry

·      How the company’s corporate level strategy relates to horizontal and vertical integration

·      How Michael Porter’s model applies (or could apply) to the company

·      What SWOT analysis can tell us about the company

·      How the company market its product and compete in the market place

·      How the company develops competitive advantage and compete effectively across industries and countries

·      How the company can enhance and sustain competitive advantage in the global marketplace

·      Key opportunities for Shared Value strategies

The paper should be 10 – 12 pages, APA format, all references appropriately cited.  

Presentation: 

Minimum of 20 slides of power point presentation is also needed using the paper you have created.

One slide for each above question is minimum needed.

Note this must be original work

Reference:

For your reference I am uploading a 100% exact work on existing company EBAY.

One can take it as reference.

Remember we cannot use this paper, because in this assignment it was asked to analyze the above points on a newly established firm whereas the reference document is on existing firm EBAY

EBAY

Theorganizational structure of the company and its governance. Ethics and Corporate Social Responsibility.

eBay was started in 1995 and has seek continuous transformations and innovations as per the requirements of the business. It started as an online auction store where buyers and sellers can meet and bit for goods. As time went on, it improved its business by providing various options like sellers and buyers providing feedback about each other to ensure trust. It started the PayPal online credit transfer for each payments of goods and services.

The strategic leadership of the company

· eBay website is free to use for buyers, but sellers are charged fees for listing items and again when those items are sold. The company also makes additional money through its PayPal subsidiary which is used by sellers to collect payment for items sold.

· eBay develop plans for multi-divisional structures when they wish to develop and expand their businesses by overcoming competitive issues and miscommunications. With multi divisions they divide their big organization into smaller divisions like shipping methods is divided into smaller groups like UPC, ISBN, online classified advertisements like eBay Classifieds thereby reducing issues in managing a resources and overcome dependencies. Products will be maintained in a wide range as for customers to choose as per their preferences.

· Managers can observe and estimate the requirements of their divisions and also can foresee the long-term needs. As an organization they can come up with a competitive new products with as fast pace.

The competitive advantage of the company and how the company takes advantage of its competitive advantage in the marketplace

The financial viability and growth of the company

· eBay looked at implementation of strategies that give long-term benefits to the company. The company acquired PayPal to provide buyers and sellers with a safe online payment transfer system.

· This helped in increasing profits as it commissioned 3% of sales from sellers for payment through PayPal. This provided long-term benefits to the company as it provide more security to the customers and sellers, and in turn make them to return to make transactions, as there are many fraud transactions which can be eliminated using PayPal.

How the company formulate and implement strategy at the functional, business and global level

· eBay has a deep personal vision and understands its competencies. It has a control over its actions. It understood that Skype is not required as means of global communication between sellers and buyers and let Microsoft acquire it in 2011.

· It focused on its energy as a platform for sellers and buyers to make transactions and moved internationally and increased its revenue and profits.

How the company’s strategic planning relates to domestic and global expansion and growth

· It expanded in various retail markets. It also started the “Buy it Now” option so that good and services which are not for auction can be brought by merchants and sold at the website.

· eBay always tried to growth by learning and applying its knowledge to the business. Many innovations were made and new ideas were established. eBay provided buyers the option to compare varied type of products displayed by different merchants along with prices, so that they can pick the best product they desire.

How the company use technology to perform and advance competitive advantage

· eBay has a deep personal vision and understands its competencies. It has a control over its actions. It understood that Skype is not required as means of global communication between sellers and buyers and let Microsoft acquire it in 2011. It focused on its energy as a platform for sellers and buyers to make transactions and moved internationally and increased its revenue and profits.

· eBay looks at the world as a market for its business. It looked internet as an online place for auction and developed a world-wide network for auction of goods and services by sellers and buyers, as online in today world is most preferable for the transactions and people can buy in one click of button instead of going to the stores.

How the company sees its own environment in its own business and industry

· eBay shares its vision with all the individuals of the company so that everyone strives to achieve its mission. This helps all of them to work together to reach a common mission. eBay employees are well informed about the new innovations and implementation of new strategies by the management.

· Encourages in open discussions to solve out the problems on a priority basis and put in front of the management that the decisions made.

· This discipline is implemented at eBay so that all individuals come out with different ideas for the development of the business or the units they work for. Extensive training is given to all employees and efforts are put to retain talented employees.

How the company’s corporate level strategy relates to horizontal and vertical integration

Horizontal integration:

· In November 1996, eBay entered into its first third-party licensing deal, with a company called Electronic Travel Auction to use Smart Market Technology to sell plane tickets and other travel products.

· The accounting software company

Intuit

launched in 2006 a service called ItsDeductible which is a free web-based donation tracking service. With regard to eBay, the service uses data from the site to assist users in assigning a

market value

to the items they donate.

· eBay sells the replaceable parts at a lower price.

· eBay Increase bargaining power from suppliers.

· Reduce in the repairing cost as importing directly from producers will reduce the cost.

· Product Bundling: combination of extra warranty along with the product sale will help winning the customers confidence.

· Adds a competitive advantage over its competitors as it offers more numbers of products.

· Decrease in sales and marketing expenses, as the marketing expenses of both the companies are combined.

· Reduction in duplication of resources and increase in economies of scale as they share their resources, skills, capabilities, research and developments.

Vertical Integration:

· Corporation will be merging with Intel which makes investments in electronics. Through this merger it will have assured flow of investments for its business.

· eBay completed the sale of Skype for $2.75 billion, but will still own 30% equity in the company.

· Expand its business model not to supply hardware products.

· Corporation can gain competitive advantage by innovating different forms of products as per customer preferences.

· Having its own source of raw-materials increases efficiency and economies of scales as it doesn’t have to depend on suppliers and bargain with them.

· Increases confidence over the quality of the products.

· As this reduces manufacturing costs, customers receive the final products at a lower price which reduces the bargaining power of buyers.

How Michael Porter’s model applies to the company

The strategy which is built is robust and is based on the “PORTERS Competitive Force Model” to be successful in the market.

THREAT OF NEW ENTRANTS

POWER OF BUYERS

POWER OF SUPPLIERS

COMPETITIVE RIVALRY

THREAT OF SERVICES OR SUBSTITUTES

Porter’s competitive external forces model relies on following forces:

· Threat of services or substitutes:-services enables new substitutes to emerge with new approaches to meeting needs and performing functions.

· Power of buyers: availability of global price and product information shifts bargaining power to customers

· Power of suppliers: procurement over the internet tends to raise bargaining power over suppliers, suppliers can also benefit from reduced barriers to entry and from the elimination of distributors and other intermediaries standing between them and their users.

· Threat of new entrants: the internet reduces barriers to entry, such as the need for a sales force, access to channels, and physical assets, it provides a technology for driving business processes that makes other things easier to do

· Competitive rivalry : widens the geographic market, increasing the number of competitors, and reducing differences among competitors , makes it more difficult to sustain operational advantages; puts pressure to compete on price

Risk of Entry: “HIGH”

· There could be a risk of potential competitors who could enter the industry which would result in increase in industry capacity, lower costs and also begin a competition. The Threat of new entrants is governed by some of the following barriers of entry:

· Economies of Scale

· Brand loyalty

· Government Regulation

· Ease in distribution

· Customer Switching costs

· Absolute Cost advantage

Rivalry among established companies: “HIGH”

· Highly competitive with established companies like Best Buy and other

· Demand for Electronic Products provided by Electronic Corporation is High resulting in fierce competition

· Increased costs lead to companies trying to increase sales which leads to increased competition

· High exit costs lead to companies not leaving the businesses and keeping the market competitive

Bargaining power of buyers: “LOW”

· Bargaining power of Buyers means that the buyers have the potential to bargain down the price of the product.

· Buyers try to profit from the lowered prices as they are large quantity buyers. They know the market and also have full information about the product and hence have alternative and pose as a threat.

Bargaining Power of Suppliers: “LOW”

· Low Switching costs from one supplier to other

· This refers to the potential of suppliers who supply input to the industry to increase the prices of inputs.

· Strong suppliers would profit from increased input prices and this usually happens when suppliers sees that buyers have no other substitutes or any alternatives. This supply is an important input for buyer’s product and hence they are considered as significant threat.

Substitute & complimentary in the market: “HIGH”

· This threat refers to the substitute of product which can be equally able to satisfy customer. So, this would restrict the profitability by hindering the ability to raise the price of the product.

· Also, if the number of substitutes is less, then the profitability will be more.

· It is very efficient by sending automatic emails when there need to be taken immediate actions.

· It delivers very strategic improvements for future developments.

· Plan, execute and follow up on campaigns to drive efficiency and improvements.

· It develops content and collateral based on the input and ideas of both teams and what the data reveals about past activities

How Peter Senge’s Learning Organization Model applies to the company

A learning organization has five main features;

· Systems thinking

· Personal mastery

· Mental models

· Shared vision

· Team learning

What SWOT analysis can tell us about the company?

Strengths

· Quality Maintenance

· Affordable prices

· Customization

Opportunities

· Expand in research markets and customer service.

· Introduce variety products as per the needs of the customers

Weakness

· Difficulty to move to new markets

· Increasing costs

Threats

· Similar competitors like Amazon.

· Price comparisons

· Customer focus towards low price products at better quality.

How the company market its product and compete in the market place

Strategy: “Act Global, Think Local”

· eBay Electronics Corporation plans to open stores globally to satisfy the local customers. It does research on the preferences of the local customers. All the products will be modified a little as per the customer preferences.

· For example, in United States many people like iPhone and whereas in Japan many people like Android phones. Hence layout, services and prices all are customized to satisfy customers.

· Corporation will adopt the transnational strategy while entering the foreign markets. It has a high pressure for both local responsiveness and costs reductions.

Pressure for costs reduction:

· Corporation strategy is to offer products at a lower price to increase customer’s base and gain an advantage over its competitors. To offer products at lower cost it has to gain cost leadership. It can gain cost leadership by

· Have suppliers from the same country. This will reduce transaction costs

· Just-in-time inventory to reduce storage costs.

· Updating with new technology to save time, cost and improve services

· Marketing expenses can be reduced by choosing outlet locations where most of the population passes by and making attractive to grab individual’s attention by introducing a variety of products.

· Have a single R&D department which can share the output with all other departments as per the latest developments in the market.

How the company develops competitive advantage and compete effectively across industries and countries

· Skype acquired StubHub in 2007 and acquired 25%Electronics Corporation enters into a 25%/75% joint venture with

Major League Baseball

(MLB), understand the new customers and increase revenue.

· eBay acquired Skype in 2005to expand its customer base worldwide.

· Corporation markets its products through TV, radio, print and online media.

· Opening small outlets at special events.

· Sponsoring events.

· Making store attractive.

· Utilize digital coupons.

· In the summer of 2004, eBay acknowledged that it had acquired 25% of classified listings website, as craigslist is one of the leading on selling used products.

· Since 2012, eBay has also allowed US sellers to opt into its Global Shipping Program. If a seller has opted into the program and a buyer not from US buys an item from that seller, then the buyer pays an additional fee to

Pitney Bowes

.

References:

https://en.wikipedia.org/wiki/Learning_organization

[Charles_W._L._Hill,_Gareth_R._Jones,_Melissa_A._S(BookZZ.org)

https://en.wikipedia.org/wiki/EBay